The UK carbon-cutting target of 34% for 2022 is likely to be exceeded. Photograph: Dan Kitwood/Getty Images

The UK is set to substantially over-achieve on its carbon-cutting targets, with potential economic benefits in cost savings and the growth of new industries, according to a government report.

Since 1990, the UK's carbon emissions have dropped by a quarter, but the report made clear that the carbon cuts of the past two decades were much easier to achieve than those needed in the next 20 years. These will require investments of hundreds of billions of pounds and the transformation of the UK's energy, transport and industrial sectors.

The research was timed to have an impact on the Durban climate change conference, taking place this week and next, because the government believes it shows that emissions reductions are achievable at a low cost, and hopes that other countries will follow the UK's example.

Chris Huhne, secretary of state for energy and climate change, said: "This sends a strong and clear signal that the UK is walking the walk on climate change – it shows other economies that, with the right planning, the transition to a low-carbon economy is achievable and affordable."